Regional Factbooks

Diagnostics upon human material (blood, urine or others) can be processed in vivo, i.e. directly on the patient, or in vitro, on samples taken from the patient. That last technique is definitely the most common (accounting for more than 99% in the Romanian diagnostics field). In vitro diagnostic products are the major part of the diagnostic market worldwide.

Differences between the equipment and materials used in different countries are important, but there is a similar structure of a diagnostics laboratory planning around the world, as well as there are similarities in the healthcare network in most of the countries.

A. Market Highlights and Best prospects

Statistical Data

With a population of 22.3 million inhabitants, Romania is, after Poland, the second largest Central European country. The Romanian healthcare system is under a process of reform and a Statutory Health Insurance system has been introduced since March 1, 2000. The main unit for this system û the National Insurance House (NIH) û is now working upon establishing its operating mode in the territory. NIH has drawn up a list of diagnostics tests that are reimbursed by NIH if they are prescribed by the family physician or by the physician in the hospital who is authorized to do it. All other tests are to be paid by the patient, irrespective of whether they are performed in a state-owned hospital, a private lab or in urban clinics. Prices for diagnostics tests are negotiated by the NIH with the service provider.

According to estimations, in 1999 Romanian state-owned and private healthcare units spent about $55 million on laboratory materials. It is worth noticing that in recent years the market has increased constantly, in spite of financial difficulties at a time of transition to a market economy. Since there are practically no local producers (factories in Bucharest, Cluj, and Timisoara turn out instruments and reagents valued at no more than $0.5 million per year), imports are of paramount importance. Diagnostic instruments and reagents are marketed in Romania through local sales agents and distributors. For the public sector, the purchase of diagnostic instruments and test kids is usually made via domestic or international tenders. In the private sector, instruments and test kits are usually procured through local distributors or subsidiaries of foreign suppliers.

In 1999, the market share of Romania's various foreign suppliers of diagnostic instruments and materials was as follows:

Country	Market share%
France	25%
Germany	25%
USA	15%
Italy	10%
UK	5%
Japan	5%
Asian countries	5%
Hungary	4%
Poland	2%
Other	4%

American diagnostic products are well rated by Romanian users, but their prices are higher than for similar European products, mainly because of higher customs duty and freight costs. Air shipment is a rule with diagnostics materials, but, from the USA, this often takes more than 10 days, a delay which can affect the quality of products that need to be refrigerated or have special storage requirements. This is the reason why local distributors prefer European products, even if U.S. products are at a better price.

Market Trends

During the next years, sales of diagnostics instruments and materials can be expected to increase due to the fact that the policy of the Health Ministry is directed toward organizing more healthcare points, toward disease prevention rather than hospitalization. Screening of the population for infectious diseases will be an important part of the health policy. Also, in order to increase the quality of medical diagnostics, "reference labs" equipped with state-of-the-art materials and instruments will be organized in major cities.

B. END-USER ANALYSIS

In Romania, the healthcare system is based both on state-owned hospitals and on private units. The state-owned sector includes:

• very big hospitals (10 units in Bucharest, 1 or 2 units in each of the 40 districts)
• medium hospitals (123 û in middle sized cities, and specialized units in big cities)
• small hospitals (more than 300 units).

  Until recently, sample processing and storage were not paid due attention. This is why the presence of samples contaminated by inadequate recipients is common in about 50% of medical labs (mostly state-owned). Centrifuges are still working, but they are old-fashioned. Positive identifying by bar-coding is practically not known; the same situation is for any kind of LIMS (Laboratory Intelligent Management System) or LIS (Laboratory Information System).

Biochemistry is in a considerably better position, since during the last 10 years about 5,000 automated analyzers have been purchased or leased. 20% of them are big instruments, and about 65% of the total are in big state-owned hospitals. Only 2% of private units possess big automates (more than 150 test/hour).

Immunology is a field that will hopefully develop in the next years, because so far there is a quasi-empty market in this area.

Hematology is not very well furnished with instruments, in spite of efforts made by the Health Ministry and the World Bank, that financed the purchase (through bids) of over 100 automated units for county hospitals and ob/gyn hospitals in the country.

There is an emerging OTC market which currently accounts for about 12% of the total amount spent on reagents. This important value is due to the fact that most products labeled by producers as OTC (pregnancy test excepted) are used for rapid tests in private labs and in most of the hospitals.

C. COMPETITIVE ANALYSIS

U.S. diagnostic instruments and reagents are well known and well rated in Romania, but they face strong competition on the market. Major U.S. suppliers active on the Romanian market are Beckman-Coulter and Johnson & Johnson for big instruments, and WDI for small instruments, reagents and rapid test kits. Beckman-Coulter has been in the market for more than 20 years, while Johnson & Johnson has a very good policy of leasing the instruments, a fact which made the company almost the leader of the market during the last two years, with more than 20 big analyzers installed every year.

Major European companies on the market are Roche-Boeringer, Cormay, Sysmex. The Japanese Hitachi is now entering the market with a very well organized financing campaign.

The biochemistry market is developing at a rapid pace. Hematology analyzers and reagents have good prospects for the next years, and there will be a very significant development for the bacteriology automated instruments (there are only several French bioMerieux automata instruments on a market that requires at least 100 such units). In immunology, U.S. Abbot lost a big market because of bad luck in choosing local distributors. This, too, tends to be an empty market.

D. MARKET ACCESS

Health Ministry approval is required for instruments (code 90.18). This approval is easier to be obtained if an ISO Certificate can be provided for the instrument. For measuring instruments, there is also necessary a National Institute of Metrology model approval.

Tax and tariff barriers are imposed for products coming from the United States, a fact that makes them less competitive than similar products from the European Union. Importers of U.S. products need to pay 10% customs duty, plus a compulsory duty tax of 2%, plus a 0.5% tax for the benefit of Romanian Customs. VAT (19%) is, therefore, calculated upon a price including transport fees plus all of the above taxes, which leads to a price increase of about 20%. There is a no-duty exception for biochemistry analyzers during the first 6 months of the year 2000. The high level of duty is a serious impediment to imports from the United States, especially for hematology analyzers, blood cell counters and composite reagent test kits, products that become less competitive than similar EU products, even if they are of better quality.

Reagents (code 38.22) so far need nothing else but a formal import approval of the Ministry of Health. Since July 2000, according to EU regulations, pre-marketing registration will be required in Romania for the following reagent test kits: hepatitis and HIV diagnostic reagents, ABO blood grouping, diabetes diagnostic, including OTC rapid test kits.

Distribution practices

The majority of diagnostic products (almost 100% for instruments and 90% for reagents) are purchased by laboratories through local distributors or directly from manufacturers. Important tenders are organized every 2 or 3 years, with financing from the World Bank. A USD 50 million tender for diagnostic instruments and reagents will be held during the 2nd part of 2000, and it will double the sales in the diagnostic field. Local distributors of important manufacturers have the great advantage of direct contact with end-users û they have the possibility of effective marketing, and practice shows this is the most cost-effective way to do sales. On the other hand, local distributors tend to sell products of different manufacturers, and this often leads to conflicts of interest (both Helena and Beckman lost market in Romania because they had the same local distributor).

Payment and financing practices

The payment period in the diagnostics field is usually 30-60 days. Payment on schedule can be expected in only about 50% of the deals, because most of the local companies, as well as foreign joint ventures, are experiencing payment problems when dealing with state-owned hospitals. The latter are paying only when and if the Government provides money, and are generally not willing to adjust payment for rate-of-exchange losses. That is why local companies often lose money.

To circumvent financing problems, some companies have been using a "leasing" scheme for the purchasing of instruments, having end-users buy reagents at increased prices in exchange for leasing instruments for a period of several (1 to 5) years. Johnson & Johnson would simply lend the instruments for as long as the end-user buys reagents, but this practice is beginning to generate strong opposition.

E. Key Contacts

AMEX IMPORT-EXPORT Str. Drumul Sarii 23 Bucharest Tel. (40-1) 410-50-30 Fax (40-1) 410-65-58 E-mail: amex@pcnet.ro

 

CORMEY ROMANIA Str. Clucerului 30-32 Bucharest Tel./ Fax (40-1) 222-44-95, 222-79-43 E-mail: cormay@opensys.ro

 

PROTON IMPEX 2000 Calea Calarasilor 163, Bl. 38, Sc.1, Et.5, Ap. 23 Bucharest Tel./ Fax (40-1) 322-53-22

 

CANORI IMPEX Str. Veronica Micle 20, Bl. M6, Sc. B, Et.6, Ap. 88 Bucharest Tel. (40-1) 659-94-39/231-04-20 Fax (40-1) 653-50-19 E-mail: canorii@isp.acorp.ro

 

CLINI-LAB Str. Gheorghe Marinescu 49, Targu Mures Tel. (40-65) 21-87-84, 21-87-85 Fax (40-65) 21-84-07 E-mail: clinilab@netsoft.ro

 

FIRST MONITOR ROMANIA CANADA Str. Fecioarei 7 Bucharest Tel. (40-1) 210-79-51, 210-79-57 Fax (40-1) 210-78-02 E-mail: fmr@kappa.ro

 

HOSPITEX DIAGNOSTICS Aleea Serdarului 9, Bl. 46B, Ap. 2, Sector 1 Bucharest Tel. (40-1) 666-44-91 Fax (40-1) 224-17-71 E-mail: hospitex@mail.kappa.ro

 

MEROM Str. Hollosi Simon 70 Baia Mare Tel./ Fax (40-62) 27-65-94)

 

MITHOS APARATURA MEDICALA Str. Sf. Elefterie 26, Sector 5 Bucharest Tel. (40-1) 410-82-63, 410-82-73 Fax (40-1) 410-81-81 E-mail: mithos@mb.roknet.ro

 

NOBIS LABORDIAGNOSTICA Str. Fantanele 18 Cluj Napoca Tel. (40-64) 18-64-74 Fax (40-64) 18-65-43)

 

PRO-TEST COMPANY Blvd. Burebista 3, Bl. D16, Sc. 4, AP. 113 Sector 3, Bucharest Tel./Fax (40-1) 322-69-16

 

SALES PROMOTION AGENCY Str. Maguricea 7, Bl. 3K, Sc.3, Ap. 30 Bucharest Tel. (40-1) 230-51-75, 320-51-76 Fax (40-1) 230-51-77

 

TEHNO ELECTRO MEDICAL Co. Sos. Mihai Bravu 192, Bl. 204, Sc.B, Et.1, Ap. 35-36 Sector 2, Bucharest Tel/Fax (40-1) 321-67-83, 323-72-70 E-mail: temco@rtns.ro

 

TEHNOMED Str. Clinicilor 37 Cluj-Napoca Tel./Fax (40-64) 19-55-03 E-mail: tehnomed@codec.ro

 

DG INSTRUMENTE STIINTIFICE Calea Manastur 70, Ap. 30 Cluj Napoca Tel. (40-64) 42-76-79, 42-76-78 Fax (40-64) 42-76-79 E-mail: maitlo:avl@dg.codec.ro

Demographics & Economic Situation

Source: Factbook.net